The House Oversight Committee has widened its investigation into insider trading on prediction market platforms to include Hyperliquid, Crypto.com and Aristotle Exchange, requesting documents on how the venues verify users and monitor trades. Chairman James Comer, a Kentucky Republican, disclosed the expanded requests in a committee release this week. Cronos (CRO), the token tied to Crypto.com, fell as much as 6.9 percent after the news and was among the worst performers in a flat broader market, CoinMarketCap reported.
What the committee wants
The inquiry started in May 2026, when the committee launched an investigation into insider trading on online prediction market platforms. Since then, Comer’s staff say they have received nearly 1,000 documents and five briefings from Polymarket and Kalshi representatives, the two biggest US-facing venues. The expanded phase asks the new platforms to explain how they meet legal obligations on identifying users, restricting access by geography, and detecting and preventing suspicious trading before it happens.
The core concern is that traders with nonpublic or classified government information are betting on prediction markets, for example contracts tied to elections, policy decisions or military actions, and profiting from knowledge the public does not have. Congressional interest sharpened after a widely reported incident in which a wallet linked to a French trader took large positions on a major geopolitical event shortly before it happened. The committee has not established that the trader had access to confidential information or violated insider-trading rules, Cryptorank noted, but the episode is what pushed the probe from quiet inquiry to public document requests.
Why crypto venues are in scope
Hyperliquid is a decentralized perpetual futures exchange that also hosts prediction-market-style activity, and much of its order flow runs through offshore infrastructure outside direct US regulatory oversight. Crypto.com operates a large exchange and prediction product with a US customer base. Aristotle Exchange is a newer platform in the same category.
Inclusion in the committee’s inquiry does not mean the committee has found wrongdoing at any of the three. Document requests are standard early steps in congressional investigations: the committee collects the material, holds briefings, and decides later whether to hold hearings or refer matters to regulators or prosecutors. But being added to the list puts each company on the record about its compliance controls, and that alone carries cost, both in legal spend and in relations with banking partners who are already nervous about serving crypto firms.
For Hyperliquid especially, the timing is awkward. The venue has previously come under scrutiny for its offshore arrangements, and a congressional document request gives critics a fresh anchor for arguing that decentralized platforms with US users need clearer rules rather than a gray zone. The HYPE token has been one of the strongest performers of 2026, and long holders have little appetite for a headline-driven drawdown.
What the platforms have said
Polymarket and Kalshi, the original subjects, have cooperated with briefings and document production, according to the committee. The new venues have not publicly detailed full responses at time of writing. Crypto.com did not immediately publish a statement addressing the expanded request, and Hyperliquid’s response would come through its contributor entities rather than a single legal face, which is part of the challenge for congressional staff trying to pin accountability on a decentralized venue.
A US House committee’s expanded probe sends a clear signal: platforms with US users should expect questions about identity checks, geographic blocks and suspicious trade monitoring regardless of where they are incorporated.
The regulatory backdrop
The probe runs alongside a bigger fight over who regulates prediction markets in the US. Kalshi’s sports and event contracts have drawn parallel state-level cease and desist actions in several states and a mixed reaction at the federal level, while Polymarket cleared a major hurdle in its effort to return to US customers through its acquisition of a CFTC-licensed venue. The House Oversight inquiry, which is about insider trading specifically, adds a market-integrity angle on top of that jurisdictional fight.
The distinction matters for crypto investors. CRO’s drop on the news is pricing in a compliance cost and reputational drag, not a business-model threat. Hyperliquid’s exposure is bigger, since its growth story depends heavily on US-adjacent traders and the venue has no clear US regulatory home today. A committee report calling out gaps in identity verification could feed into any number of pending rulemakings, and committees have a habit of summarizing findings at the least convenient moment for the companies involved.
There is also a precedent worth remembering: congressional crypto investigations in recent years have moved markets mostly on disclosure days, then faded until the next drop or hearing. Investors who played the last cycle learned that document-request headlines are noise, and hearing headlines are weather.
What happens next
The committee will collect documents from the three new venues, cross-check them against what Polymarket and Kalshi produced, and decide whether abuses appear systematic or isolated. Outcomes range from a quiet report with recommendations, to public hearings with named traders, to referrals to the Commodity Futures Trading Commission or the Justice Department.
Traders should expect the story to run in phases. Document production takes months, and hearings tend to follow once committees have enough material to question witnesses on the record. Each disclosure window is a chance for another headline, which is exactly the kind of overhang that keeps pressure on tokens like CRO while the inquiry remains open.